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WiredWest: a Cooperative of Municipalities Forms to Build a Fiber Optic Network

Author(s):

David Talbot

Waide Warner

Susan Crawford

Publication Date:

Wednesday, 2016, April 20

In 2010, communities in rural western Massachusetts began a group that would evolve into the WiredWest Cooperative. Over the past six years, the group, formed to bring better last-mile connectivity to the unserved and underserved areas of the state, has faced a number of challenges. Most recently, disagreements with the Massachusetts Broadband Institute (MBI), the state agency tasked with distributing funds for last-mile connectivity, have threatened WiredWest's regional cooperative model.

In a new report released by the Berkman Center, authors David Talbot, Waide Warner, and Susan Crawford share the story of these communities' attempt to band together to establish a fiber-opticnetwork.

In WiredWest: a Cooperative of Municipalities Forms to Build A Fiber Optic Network, we learn not only how this region came together, but how they developed their business plan and procured funding, how they anticipate the network to affect affordability, and the ways they have adjusted the plan as circumstances required. The authors also take the time to share some history of cooperatives, and address how the cooperative model - used in the past for electricity and telephone - can benefit the communities in rural western Massachusetts.

Key Findings from the report:

WiredWest enabled dozens of small towns to come together through a unified structure and a shared vision of citizen cooperation across municipal borders, a model replicable nationwide.

WiredWest has developed and vetted a detailed financial model, drafted an operating agreement, and obtained $49 deposits from more than 7,100 residents who have pledged to subscribe to Internet access services.

WiredWest’s plan is designed to achieve economies of scale by centralizing operations and aggregating demand for network equipment and services. WiredWest still must resolve the question of how to balance cooperative versus local ownership of network assets within the boundaries of individual towns.

The scale of the project would also allow WiredWest—in likely contrast to single-town networks in the same area—to provide television services, which a majority of pre-subscribers want.

WiredWest plans to offer 25 Mbps service for $49 a month, 100 Mbps service for $79 a month, 1 Gbps service for $109 a month, telephone services for an additional $25, and TV services at prices to be determined.

In December of 2015 a consultant hired by the Massachusetts Broadband Institute (MBI) issued a highly critical analysis of the WiredWest financial model, but WiredWest responded with a point- by-point rebuttal asserting that the analysis was inaccurate and misleading.

In January of 2016 the administration of Gov. Charlie Baker asked MBI to “pause” on funding last-mile projects and later asked MBI to analyze all options, without mentioning WiredWest.

Struggles In The State

As we reported late last year, one of the biggest hurdles for WiredWest has been opposition from MBI. Talbot, Warner, and Crawford dedicate significant coverage to the problems between WiredWest, MBI, and Governor Charlie Baker's administration.

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Random Quote

Electricity is not in any sense a necessity, and under no conditions is it universally used by the people of a community. It is but a luxury enjoyed by a small proportion of the members of any municipality, and yet if the plant be owned and operated by the city, the burden of such ownership and operation must be borne by all the people through taxation. Now, electric light is not a necessity for every member of the the community. It is not the business of any one to see that I use electricity, or gas, or oil in my house, or even that I use any form of artificial light at all.